Mr. Mitul Shah - Head of Research at Reliance Securities.
Indian equities started of the week on a positive note as the Nifty was up 0.3%. Broader markets ended slightly higher as Nifty Mid Cap and Nifty Small Cap were up 0.1% and 0.4% respectively. Majority of sectoral indices ended in green. Nifty Auto (+1.3%), Nifty Media (+0.9%) and Nifty Pvt Bank (+0.7%) were the major gainers. Nifty FMCG (-0.5%) and Nifty PSU Bank (-0.4%) were the primary laggards.
US stocks advanced on Friday, after traders cheered the latest jobs report and the passage of the debt ceiling bill in the Senate. The S&P 500 rose 1.5% to its highest level since August, marking its third straight week of gains with a 1.8% increase. The tech-heavy Nasdaq Composite added 1.1% and ended at a level last reached in April 2022. Its weekly increase of 2% brought the index its sixth consecutive week of gains. The Dow was up ~2% on Friday and for the week. US labour department showing non-farm payrolls rose by 339,000 in May, well above the 190,000 consensus estimate of economists. Meanwhile, Saudi Arabia announced further cut in its oil production by 1 mn barrels/day. Brent crude is trading higher at $77/barrel.
The 4QFY23 earnings season has ended with the sample of NSE 500 companies excluding BFSI reporting a revenue growth of 16% YoY/8% QoQ while EBITDA grew 18% YoY/12% QoQ as companies passed on higher costs to consumers. EBITDA margins improved 100bps sequentially. Adj PAT rose 20% YoY/43% QoQ. Sectors such as automobiles, cement, FMCG, consumer discretionary reported healthy margin improvement sequentially while metals and retail saw contraction. The RBI monetary policy committee will meet this week with the interest rate decision due on Thursday, 8th June. Consensus expectations are of a continued pause. Meanwhile, the onset of monsoon over India has gotten delayed.